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2017: Midland National Introduces XL Heritage

Midland National® Life Insurance Company announced the release of a new product offering to customers: XL Heritage Indexed Universal Life insurance (IUL).

The product provides guaranteed death benefit with a single premium and added positive attributes, such as liquidity and living benefits.1

According to a Morgan Stanley study, over the next several decades, the Baby Boom generation could transfer as much as $30 trillion in assets to the next generation.2 XL Heritage was created for Midland National clients between the ages of 50-80 carrying liquid assets amounting $25-200K which is not needed to fulfill retirement needs.

Midland National expects XL Heritage to add incremental sales ranging between 5% and 7% of Midland National’s annual premium revenue. Long-term, sales are expected to increase premiums by 10% to 15%. Additional positive facets to this product include:
  • An Accelerated Death Benefit feature that allows the policy owner to use a portion of the death benefit while they are living. 
  • The product’s cash value isn’t invested in the stock market, the building of cash value is tied to the movement of a selected index--policyholders can also capture a percentage of stock market increase[m1]  while protecting cash value[m2]  against downside risk.
  • The product features an annual reset that locks credited interest at the close of the contract year.
  • The annual premium bonus of 2% (credited as interest to the cash value) is paid during policy years five through nine.3
1 Although XL Heritage is filed as a Flexible Premium Universal Life and allows additional premiums, the product is designed for a single premium payment. There are limited benefits to adding premiums after policy issue - for example, the Account Value will increase with additional premium payments, but the guaranteed death benefit and the Return of Premium Value will NOT. Therefore, clients should carefully consider whether additional premiums should be paid. Product availability subject to state approval.
2 Source: CNBC 11-30-16, Morgan Stanley 2015, Accenture. The “Greater” Wealth Transfer – Capitalizing on the Intergenerational Shift in Wealth, 2012; Accenture 2016.
3 A guaranteed premium bonus is paid in increments of 2% each year in policy years five through nine for a total of 10%.  Bonus applies to the initial premium less any withdrawals and withdrawal charges.
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